SUNDAY NATION March 16, 2014 TAKING STOCK | The Fund has reduced the pressure on MPs to engage in corruption Has CDF really changed ordinary Kenyans’ lives? W Nic Cheeseman: Critics of the Fund are likely to be most effective if they focus on how to improve it, rather than how to remove it hen the Constituency Development Fund (CDF) was introduced in 2003, it promised to make the Legislature financially independent of the president and to bring development closer to the people. But the Fund has been plagued by al- legations of corruption and there is little evidence that it has significantly improved service provision at the constituency level. So is it time to get rid of the CDF? On March 11, it emerged that MPs want to increase the CDF by Sh12 billion, with another Sh5 million going to each of the constituencies that benefitted from the stimulus package. Given that the Kenya Revenue Authority only hopes to raise Sh982.8 billion in the current financial year, this would be considerably more than the 2.5 per cent of ordinary revenues that was stipulated in the original CDF legislation. It is not entirely clear why MPs feel the need to further increase the CDF money at their disposal, because the meeting of the Budget and Appropriations Committee, in which the decision was made, was held behind closed doors. But we can make a fairly educated guess. Since the introduction of the CDF, MPs have called for the Fund to be increased to enable them to satisfy their constituents’ expectations. The creation of 47 governors and senators has further intensified the competition for local loyalties, increasing the pressure on MPs to be active in their constituencies. In other words, MPs fear being overshad- owed by governors, who are responsible for a larger area and can thus claim a stronger mandate, having received the votes of many more Kenyans. At the same time, the Sh210 billion allocated to the counties dwarfs the Sh23 billion set aside for the CDF, placing MPs at a disadvantage when it comes to the battle for hearts and minds in their home areas. Origins of CDF But does it make sense to increase the CDF, especially when such a high proportion of government revenue is devolved to the counties? To answer this question, we need to reflect for a minute on the origins of the CDF, what it was intended to achieve, and whether it has succeeded in meeting any of these goals. Kenya’s CDF was not the first — a ver- sion of the CDF existed in Uganda as early as 1969. Pakistan, Papua New Guinea and the Philippines all introduced something like a CDF in the 1990s. Similar models have now been introduced in Bhutan, Ghana, India and Zambia. But although Kenya’s CDF was introduced relatively late, there can be no doubt that it heavily influenced the subsequent introduction and design of similar arrangements in Tanzania (2009), South Sudan (2008), and Zimbabwe (2010). While all CDFs involve the decen- tralisation of development funds to the sub-national level, a recent PhD dissertation by Machiko Tsubura of the University of Sussex has found that they were not always introduced for the same reasons. In some cases, such as Tanzania, the CDF was implemented by a dominant ruling party in order to maintain the support of disgruntled MPs and preserve internal party unity. In others, newly elected governments introduced a CDF as a way of undermining the patronage structures that had supported the old order. This is what happened in Kenya. Kenyan legislators clamoured for a CDF so that they could satisfy the remarkably high demands that their constituents place on them for everything from school fees to health clinics. Campaigners such as Martin Shikuku pointed out that by guaranteeing MPs an independent source of development funds, a CDF would make them less financially dependent on the Executive. But former President Kibaki did not oblige simply because he recognised the wisdom of these arguments. Kibaki also had a second motivation: to disrupt the patronage networks of his predecessor, Daniel arap Moi. One of the first things that the Narc government did after defeating Kanu in 2002 was to set up an investigation into the practice of harambee “self-help” projects. Under Kenya’s first President Jomo Kenyatta, the call to harambee had become a national slogan for the mobilisation of development efforts. Kenyatta’s government pledged that if local communities could build educational or health facilities by pooling resources and labour, the State would cover the running costs. MPs played a critical role in this process because they were encouraged to be the engines, and funders, of harambee drives. Political weapon The commission of inquiry, led by a fierce critic of harambee, Koigi wa Wamwere, found that the Moi regime had used selfhelp schemes as a political weapon. MPs who were not sufficiently loyal to the president were excluded from state resources. This meant that they found it difficult to deliver development to their constituencies, which in turn, rendered them vulnerable to electoral defeat. Around the 1992 and 1997 elections, harambee contributions went through the roof as prominent Kanu leaders such as Moi, Nicholas Biwott and Moody Awori “donated” ever increasing amounts to harambee in a bid to shore up the regime’s flagging support. The way that harambee was manipulated under Moi had two important consequences for accountability. On the one hand, it rendered MPs dependent on Moi’s favour, and so undermined legislators’ willingness to speak out about human rights abuses and corruption. On the other, it created an unfair electoral playing field in constituency races, and so undermined the democratic rights of ordinary Kenyans. By prohibiting MPs from engaging in harambee activity and establishing a new fund that would confer development resources on all MPs, Narc attempted to close the door on this particular legacy. But has the CDF delivered on its promise? In one sense, no. MPs continue to engage in harambee drives because the rule banning them from doing so has not been effectively enforced. In another sense, though, things look more positive. The distribution of harambee resources was not fair according to any of the possible meanings of that word. By contrast, CDF funds are more equally distributed across the country, and take into account poverty levels. In terms of development, the record is mixed. It is clear that more resources have gone to regions that were typi- oblige simply because he recognised these arguments. Kibaki had a ation: to disrupt the patronage orks of his predecessor, Moi. NATION March 16, 2014 TAKING STOCK | The Fund has reduced the pressure on MPs to engage in corruption Has CDF really changed ordinary Kenyans’ lives? W Nic Cheeseman: Critics of the Fund are likely to be most effective if they focus on how to improve it, rather than how to remove it hen the Constituency Develop- ment Fund (CDF) was introduced in 2003, it promised to make the Legislature financially independent of the president and to bring development closer to the people. But the Fund has been plagued by al- legations of corruption and there is little evidence that it has significantly improved service provision at the constituency level. So is it time to get rid of the CDF? On March 11, it emerged that MPs want to increase the CDF by Sh12 billion, with another Sh5 million going to each of the constituencies that benefitted from the stimulus package. Given that the Kenya Revenue Authority only hopes to raise Sh982.8 billion in the current financial year, this would be considerably more than the 2.5 per cent of ordinary revenues that was stipulated in the original CDF legislation. It is not entirely clear why MPs feel the need to further increase the CDF money at their disposal, because the meeting of the Budget and Appropriations Committee, in which the decision was made, was held behind closed doors. But we can make a fairly educated guess. Since the introduc- tion of the CDF, MPs have called for the Fund to be increased to enable them to satisfy their constituents’ expectations. The creation of 47 governors and senators has further intensified the competition for local loyalties, increasing the pressure on MPs to be active in their constituencies. In other words, MPs fear being overshad- owed by governors, who are responsible for a larger area and can thus claim a stronger mandate, having received the votes of many more Kenyans. At the same time, the Sh210 billion allocated to the counties dwarfs the Sh23 billion set aside for the CDF, placing MPs at a disadvantage when it comes to the battle for hearts and minds in their home areas. Origins of CDF But does it make sense to increase the CDF, especially when such a high propor- tion of government revenue is devolved to the counties? To answer this question, we need to reflect for a minute on the origins of the CDF, what it was intended to achieve, and whether it has succeeded in meeting any of these goals. Kenya’s CDF was not the first — a ver- sion of the CDF existed in Uganda as early as 1969. Pakistan, Papua New Guinea and the Philippines all introduced something like a CDF in the 1990s. Similar models have now been introduced in Bhutan, Ghana, India and Zambia. But although Kenya’s CDF was introduced relatively late, there can be no doubt that it heavily influenced the subsequent introduction and design of similar arrangements in Tanzania (2009), South Sudan (2008), and Zimbabwe (2010). While all CDFs involve the decen- tralisation of development funds to the sub-national level, a recent PhD disserta- tion by Machiko Tsubura of the University of Sussex has found that they were not always introduced for the same reasons. In some cases, such as Tanzania, the CDF was implemented by a dominant rul- ing party in order to maintain the support of disgruntled MPs and preserve internal party unity. In others, newly elected gov- ernments introduced a CDF as a way of undermining the patronage structures that had supported the old order. This is what happened in Kenya. Kenyan legislators clamoured for a CDF so that they could satisfy the remarkably high demands that their constituents place on them for everything from school fees to health clinics. Campaigners such as Martin Shikuku pointed out that by guaranteeing MPs an independent source of develop- ment funds, a CDF would make them less financially dependent on the Execu- tive. But former President Kibaki did not oblige simply because he recognised the wisdom of these arguments. Kibaki also had a second motivation: to disrupt the patronage networks of his predecessor, Daniel arap Moi. One of the first things that the Narc government did after defeating Kanu in 2002 was to set up an investigation into the practice of harambee “self-help” projects. Under Kenya’s first President Jomo Keny- atta, the call to harambee had become a national slogan for the mobilisation of development efforts. Kenyatta’s govern- ment pledged that if local communities could build educational or health facilities by pooling resources and labour, the State would cover the running costs. MPs played a critical role in this process because they were encouraged to be the engines, and funders, of harambee drives. Political weapon The commission of inquiry, led by a fierce critic of harambee, Koigi wa Wamwere, found that the Moi regime had used self- help schemes as a political weapon. MPs who were not sufficiently loyal to the presi- dent were excluded from state resources. This meant that they found it difficult to deliver development to their constituencies, which in turn, rendered them vulnerable to electoral defeat. Around the 1992 and 1997 elections, harambee contributions went through the roof as prominent Kanu leaders such as Moi, Nicholas Biwott and Moody Awori “donated” ever increasing amounts to harambee in a bid to shore up the regime’s flagging support. The way that harambee was manipulated under Moi had two important consequences for accountability. On the one hand, it ren- dered MPs dependent on Moi’s favour, and so undermined legislators’ willingness to speak out about human rights abuses and corruption. On the other, it created an unfair electoral playing field in constituency races, and so undermined the democratic rights of ordinary Kenyans. By prohibiting MPs from engaging in harambee activity and establishing a new fund that would confer development resources on all MPs, Narc attempted to close the door on this particular legacy. But has the CDF delivered on its promise? In one sense, no. MPs continue to engage in harambee drives because the rule banning them from doing so has not been effec- tively enforced. In another sense, though, things look more positive. The distribution of harambee resources was not fair accord- ing to any of the possible meanings of that word. By contrast, CDF funds are more equally distributed across the country, and take into account poverty levels. In terms of development, the record is mixed. It is clear that more resources have gone to regions that were typi- oblige simply because he recognised these arguments. Kibaki had a ation: to disrupt the patronage orks of his predecessor, Moi. Sunday Sunday Review 29 FILE | NATION Members of the National Assembly at a past session. MPs want to increase the CDF by Sh12 billion, with another Sh5 million going to each of the constituencies cally marginalised in the past — such as Shikuku’s old Butere constituency. Research on individual constituencies, particularly in rural areas, has documented a significant increase in the number of public services that are being delivered. But there has been little movement on key development indicators over the past decade. Levels of poverty have remained high, while access to essential services such as water have remained stubbornly low, despite the combination of the CDF and reasonably high levels of economic growth. Accountability But what of corruption and account- ability — the key problem that CDF was intended to tackle? MPs no longer queue outside State House to collect their brown paper bag before they head back to their constituencies on Friday. By enabling MPs to meet the expecta- tions of their constituents, the CDF has reduced the pressure on them to engage in corruption and this can only be a good thing. But this does not appear to have had much of an impact on the level of corruption itself. If anything, the creation of the CDF seems to have simply changed the location of corruption, rather than eliminating it. In 2009, a special investigation con- ducted by the National Assembly found that 16 per cent of the funds (Sh3.2 billion) dispersed between 2007 and 2009 could not be accounted for. Tsubura notes that a report by the National Taxpayers Association came to a similar conclusion, finding that 16 per cent of funds in the 34 constituencies that it sampled “had either been uneconomically utilised, wasted or remained unaccounted for”. This is not to say that all MPs have used their funds poorly. Many welcomed the opportunity to build a reputation based on competent CDF management and positive examples of “CDF stars”, such as Peter Kenneth, emerged and have been widely cited. However, it is unclear that the average MP behaved any better under Kibaki than under Moi. This is a worrying conclusion, because the CDF is expensive. When it was introduced most government expenditure in Kenya was heavily centralised, and so decentralising 2.5 per cent went some way to redressing this imbalance. But this picture has changed radically over the past decade. The vast sums that are now devolved to the county level mean that there is a real danger that if devolution is fully implemented, the capacity of the central government will be compromised. Given this, the CDF either needs to shape up or ship out. To their credit, legislators have recog- nised the need for change. The CDF Act of 2013 revised the way in which the CDF committee is selected, making them elected positions. The hope was that this would make CDF officials more accountable to citizens and reduce the power of MPs over the Fund. But although reform is much needed, the legislation was hopelessly ambiguous. Rather than specifying a clear process through which those elected at ward level would be guaranteed a position on the committee, the actual decision of which of the elected representatives to include has been left in the hands of MPs. The new rules have also been under- mined by patchy enforcement. In some constituencies, elections were not held, while in others they have been marred by controversy. Following elections in the North Rift, voters claimed that MPs had rigged the election to ensure a favourable committee. But it seems unlikely that the CDF will be scrapped even if it continues to fail to deliver in many areas. MPs want to expand the Fund, not end it, and it is still extremely popular. Having received so little from their political system for so many years, it is easy to understand why ordinary voters are reluctant to part ways with a scheme that has, at least rhetorically, brought development closer to the people. Given this, critics of the Fund are likely to be most effective if they focus on how to improve it, rather than how to remove it. Dr Nic Cheeseman is the Director of the African Studies Centre at Oxford University